The Big Beautiful Bill and Solar Tax Credits, Explained

Key Takeaways

• The One Big Beautiful Bill Act (H.R. 1, Public Law 119-21, signed July 4, 2025) ended the 30% homeowner solar credit for expenditures made after December 31, 2025.
• It also ended the home and commercial EV charger credit (Section 30C) for property placed in service after June 30, 2026 — a date that has now passed.
• The business clean electricity credit (Section 48E) survived with deadlines: placed in service by end of 2027, or construction started before July 4, 2026 for a longer window.
• 2025 installations completed on time keep their credit, and unused amounts carry forward.

What is the One Big Beautiful Bill Act?

H.R. 1 of the 119th Congress — enacted as Public Law 119-21 on July 4, 2025, and referred to across IRS documents as the One Big Beautiful Bill Act — is the budget reconciliation law that, among many other provisions, rewrote the clean energy tax credit timeline established by the Inflation Reduction Act of 2022. For households, the changes were not adjustments; they were terminations with dates.

What happened to the 30% homeowner solar credit?

Section 25D, the Residential Clean Energy Credit, was scheduled to pay 30% through 2032 and phase down through 2034. The Act cut that to a hard stop: in the IRS's words, "You can't claim residential clean energy credits for expenditures made after December 31, 2025." The rule that decides which side of the line you fall on is installation completion — costs count when the original installation is completed, not when you signed or paid.

The same date killed Section 25C, the Energy Efficient Home Improvement Credit for insulation, heat pumps, and efficient windows and doors.

Statutory dates as of August 2026, per IRS Form 5695 and 8911 instructions.

Did the bill end the EV charger credit?

Yes — and this one caught many households off guard because the deadline landed mid-2026. The Form 8911 instructions record the change: the Act "changed the termination date for the section 30C alternative fuel vehicle refueling property credit from December 31, 2032, to June 30, 2026." The IRS applies a ready-for-use test: equipment installed and ready to use by June 30, 2026 qualified even if first used later. As of August 2026, a new home charger installation earns no federal credit.

What survived for businesses — and why it matters to homeowners

Section 48E, the Clean Electricity Investment Credit, was not repealed. Solar and wind projects qualify if placed in service by December 31, 2027; projects that began construction before July 4, 2026 have a longer completion runway under safe-harbor rules. Earlier drafts of the bill would have barred residential solar leases from 48E, but the final law dropped that exclusion.

The homeowner-relevant consequence: third-party-owned systems — leases and power purchase agreements — carry an embedded federal subsidy through 2027 that owned systems no longer get. Whether the provider passes enough of it through is a contract-by-contract question, but it is the one federal lever still touching residential rooftops.

Who was grandfathered?

Two groups kept their money. Households whose installations were completed by December 31, 2025 claim the full 30% on their 2025 returns — filed in 2026 — via Form 5695. And households whose 2025 credit exceeded their tax liability keep the difference: the instructions explicitly allow carrying the unused portion to 2026. What no one gets is a credit for a system finished on January 1, 2026 or later, no matter when the contract was signed.

What should a 2026 solar shopper take from all this?

Three things. First, ignore any pitch quoting "30% back from the IRS" — for an owned system installed this year, that number is zero, and a seller still using it is either out of date or counting on you being. Second, get lease and PPA quotes alongside cash quotes this year specifically, because the 48E-backed pricing advantage expires as the 2027 placed-in-service deadline approaches. Third, your state now does the heavy lifting: the difference between a good and bad solar market in 2026 is state credits, net metering, and utility rebates — not Washington.

Keep reading: the federal solar credit's 2026 status · claiming on Form 5695 · solar leasing after the credit.